--> Online Gaming Bill: Blanket ban may wipe out ?10,000+ crore in gaming ad revenues

Online Gaming Bill: Blanket ban may wipe out ?10,000+ crore in gaming ad revenues

By criminalising real-money gaming and its promotion, the Bill threatens one of the fastest-growing sources of India’s advertising economy.

by Team PITCH
Published - August 20, 2025
5 minutes To Read
Online Gaming Bill: Blanket ban may wipe out ?10,000+ crore in gaming ad revenues

The Union Cabinet’s approval of the Online Gaming Bill is being widely seen as a crackdown on betting and fraudulent practices. But for India’s fast-growing advertising economy, the implications cut much deeper. By criminalising real-money gaming and its promotion, while carving out exemptions for eSports and casual gaming, the Bill could redraw one of the biggest sources of AdEx growth in recent years.

From regulation to redefinition
At its core, the Bill defines an ‘online money game’ as any digital game where users pay fees, deposit money, or stake convertible assets like tokens or credits with the expectation of monetary returns regardless of whether the game is based on skill, chance, or both. This expansive framing overrides earlier judicial precedents that had protected fantasy sports, rummy, or poker under the “skill-based” umbrella.

Tanmay Banthia, Partner at TARAksh Lawyers and Consultants, explains: “The Bill meticulously defines a 'money-based gaming transaction' under Section 2(g) as an 'online money game,' encompassing any online game where users pay fees, deposit money, or stake convertible assets like credits or tokens with the expectation of monetary or equivalent returns, irrespective of whether the game hinges on skill, chance, or a blend of both, while explicitly excluding e-sports. This broad definition aims to capture the diverse mechanisms through which monetary stakes are introduced, providing a robust legal foundation for enforcement.”

Advertising at stake
For advertisers, the immediate disruption lies in marketing. Real-money gaming (RMG) and fantasy platforms have emerged as some of the country’s most aggressive spenders with annual marketing budgets crossing ?10,000 crore, rivalling FMCG and consumer tech giants. Their campaigns dominate IPL seasons, OTT screens, and digital platforms, often pushing ad rates higher for other categories.

By banning advertisements for money-based games, the Bill effectively removes one of the biggest engines of growth in India’s AdEx. For agencies and broadcasters, this represents a sudden vacuum: a sector that fuelled user acquisition spends at breakneck pace may no longer be a viable revenue stream.

According to PwC India, the Indian gaming industry is valued at over ?33,000 crore, with RMG and fantasy sports accounting for nearly 85% of the market. Operators are also huge advertising spenders. In 2023, Dream11 alone spent ?2,158 crore on ads, accounting for 41.5% of sector ad spends and 42.2% of industry revenue. Gameskraft and Games24x7 followed, spending ?1,336 crore and ?1,546 crore respectively. MPL and A23 spent nearly as much on ads as they made in revenue.

Smaller players like Howzat, MyTeam11, and Fantasy Akhada spent ?178.6 crore on marketing—more than their combined topline. Mid-sized firms like WinZo and Gameberry also spent almost as much on advertising as their revenues.

Parallel to formal spends, a sizeable unorganised betting ecosystem involving offshore brands like XBet, DafaBet, Fairplay, Parimatch, and Betway is estimated to spend upwards of ?3,000 crore on OOH and digital advertising. Industry sources say these platforms often pay nearly 2x market rates in cash to secure premium placements.

The Bill’s prohibition of money-game ads therefore impacts not just formal operators but also this grey market. While curbing betting promotions is in line with legal safeguards, the flip side is that a significant chunk of AdEx could vanish if regulated operators—who contribute most of the legitimate spends—are forced out.

Legal precedents overturned
For years, Indian courts had drawn a line between games of skill and chance, recognising rummy, poker, and fantasy sports as legal. The Bill removes that protection.

Banthia warns: “The Bill criminalises all ‘online money games’, negating past precedents and directly invoking Section 5 (prohibition of online money games) and Section 6 (prohibition of advertisements). Sponsorships, celebrity endorsements, and massive campaigns that were earlier permissible would now attract penalties, fines up to ?1 crore, and even imprisonment of key executives under Section 11 (offence by companies).”

Double whammy of tax and compliance
The sector is already burdened with a 30% winnings tax, possible GST hikes to 40% (from 28%), and enforcement against offshore operators.

Ankit Sahni, Partner at Ajay Sahni & Associates, notes: “The draft Bill declares that advertising or promotion of money-game services will itself be a criminal offence. This places media companies and agencies at direct legal risk, not just gaming platforms.”

MeitY has already shut down 1,400 illicit gaming sites, imposed taxes on offshore platforms, and enforced strict compliance. Together with ad bans, these measures heighten risks of layoffs, investor exits, and slower digital ad growth.

What’s at stake for India’s digital economy
Despite taxation and compliance hurdles, fantasy and RMG operators have dominated consumer attention with massive ad spends, creating a multibillion-rupee industry.

Banthia cautions: “The Bill’s failure to distinguish between skill and chance games disregards legal precedents that permit skill-based games. This blanket approach risks penalising a legitimate sector, triggering legal challenges and stifling innovation. For platforms like My11Circle and Dream11, the Bill dismantles the legal foundation of their business models.”

Sahni adds: “A company whose business is prohibited will, in all effect, be prevented from advertising. The draft Bill declares that advertising or promotion of money-game services will be a criminal offence, with penalties of up to 2 years’ imprisonment and ?50 lakh fine.”

Policy signal: A line in the sand
Despite industry growth, the Cabinet’s stance is clear: money-based gaming is gambling, not entertainment, and its social costs outweigh its economic benefits.

For policymakers, the credibility lies in separating eSports and casual gaming from high-stakes betting. The message is unambiguous: gaming can thrive as part of India’s digital economy, but not as a parallel gambling ecosystem.

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